Russia and Israel were both facing domestic embarrassment today after it emerged that the Israeli prime minister, Binyamin Netanyahu, had taken a secret trip to Moscow to persuade the Russians not to sell anti-aircraft missiles to Iran.

Officials in Moscow and Jerusalem were left backtracking after they initially denied media reports that Netanyahu flew by private jet to Russia to discourage the Kremlin from giving the Iranians Russia's advanced S-300 system.

His furtive encounter with the Russian leadership is likely to fuel speculation that discussions referred to the Arctic Sea, the mysterious Russian cargo ship apparently hijacked on 28 July. Several newspapers have suggested that the boat was carrying S-300 long-range surface to air missiles bound for Tehran.

The story broke in Israel after the prime minister left his office in Jerusalem on Monday, telling only a handful of his closest aides where he was going. In public, staff said he was visiting a "security installation" in Israel, but on Wednesday night the prime minister's bureau issued an update saying he had been engaged in secret activity.

It now appears that Netanyahu flew to Moscow with his national security adviser, Uzi Arad, a former officer at Mossad, the Israeli foreign intelligence agency. Rather than taking an Israeli air force jet, they leased a private businessman's aircraft at a reported cost of more than $20,000 (£12,000), flying home that evening. It remains unclear whether their mission succeeded.

Sergei Lavrov, Russia's foreign minister, refused to deny reports of the visit. "I am only going to say: to verify the rumour you should go to the source of the rumour," he said. "Our co-operation with Iran is quite legitimate. We are not selling offensive weapons to Iran."

Lavrov said the S-300 system was purely defensive, and added: "As far as the trade of military elements goes, Russia has not violated [its] international obligations."

Some reports have suggested that Mossad tracked the apparently hijacked Arctic Sea last month because it was believed to be carrying smuggled S-300 missiles from Russia, bound for Syria and Iran. Russian officials say the ship was carrying timber.

A day after the recovery of the ship, the Israeli president, Shimon Peres, also travelled to Russia to discuss weapon sales. He later claimed to have received an assurance from Russia's president, Dmitry Medvedev, that the country would "reconsider" the planned sale of the S-300 missiles to Iran.

Israel is particularly worried that Iran might use the weapons to protect its nuclear sites against a military strike. Israeli officials have repeatedly avoided ruling out a response to Iran's nuclear programme, suggesting that a military strike remains an option.

In Israel, the visit raised more questions about Netanyahu's secretiveness and style of government than it did about missiles for Iran.

Netanyahu's office attempted to diffuse criticism by attributing the confusion to his military attache. "The prime minister was busy with confidential and classified activities," the statement said. "The military attache, who was not in touch with the prime minister at that time, acted on his independent initiative in order to defend that activity, and did this through a statement that was sent to his media adviser with the best of intentions."

Some asked why, if the visit was so secret, it was allowed to leak to the press so quickly. Israel operates a strict military and security censorship policy which often prevents journalists from reporting sensitive issues, even including some apparently straightforward criminal investigations.

"The prime minister's bureau lied to the public. Simply that," said one report in the Yedioth Ahronoth, which talked of an "ugly power battle" in Netanyahu's office. It was the first major media frenzy since he became prime minister six months ago. His bureau was described by some as a "cuckoo's nest" and a "fool's paradise".